Commitments and Contingencies

Commitments:

Operating Leases

The Company has entered into non-cancelable operating lease agreements for the rental of office space and equipment. Certain of these leases include options to renew as well as rent escalation clauses and in certain cases, incentives from the landlord for rent-free months and premises reductions, and allowances for tenant improvements. The rent escalations and incentives have been reflected in the table below.

Future minimum lease payments, as of December 31, 2016, associated with these agreements with terms of one year or more are as follows:



Years Ending December 31:	(amounts in thousands)
2017	$	7,249
2018	6,240
2019	4,826
2020	4,145
2021	3,843
Thereafter	13,191
	$	39,494

Total operating lease expense included in selling, general, and administrative expenses was approximately $8.4 million, $8.1 million, and $7.7 million for the years ending December 31, 2016, 2015, and 2014, respectively.

Contingencies:

Sales and Other State Non-income Tax Liabilities

The Company's sales and other state non-income tax filings are subject to routine audits by authorities in the jurisdictions where it conducts business in the United States which may result in assessments of additional taxes. The Company accrues sales and other non-income tax liabilities based on the Company's best estimate of its probable liability utilizing currently available information and interpretation of relevant tax regulations. Given the nature of the Company's business, significant subjectivity exists as to both whether sales and other state non-income taxes can be assessed on its activity and how the sales tax will ultimately be measured by the relevant jurisdictions. The Company makes a determination for each reporting period whether the estimates for sales and other non-income taxes in certain states should be revised. The expense is included in selling, general and administrative expenses on its consolidated statements of operations and the liability is reflected in sales tax payable within other current liabilities as of December 31, 2016 and 2015, on its consolidated balance sheets.

During 2011, a state administrative ruling related to certain service tax matters was released which indicated that services performed in that particular state are subject to a tax not previously paid by the Company. As a result, the Company conducted an initial review of certain other states to determine if any additional exposures may exist and determined that it was probable that some of its previous tax positions would be challenged. As a result, the Company changed its assessment of certain non-income tax positions and estimated a liability related to these matters. For the year ended December 31, 2014, the Company accrued an additional pre-tax liability related to the non-income tax matters of approximately $0.2 million, and paid approximately $0.1 million to settle with certain states. In 2016, the Company paid approximately $1.4 million to settle with certain states, which was fully reserved for at December 31, 2015. For the year ended December 31, 2016, the Company recognized a pre-tax benefit of $0.8 million related to non-income tax matters. The expenses are included in selling, general, and administrative expenses on the consolidated statements of operations for the years ended December 31, 2016, 2015, and 2014 and the liability is included in other current liabilities on the consolidated balance sheets as of December 31, 2016 and 2015.

Legal Proceedings

On December 4, 2012, the Company’s subsidiary, CC Staffing, Inc. (now known as Travel Staff, LLC) became the subject of a purported class action lawsuit filed in the United States District Court, Northern District of California. In 2013, the parties agreed to settle this lawsuit for $0.8 million with the understanding that such settlement is not an admission by the Company of any liability, negligence or wrong doing. The Court granted final approval of the settlement in September 2014 and during the fourth quarter of 2014 the Company paid $0.8 million to the plaintiff.

The Company is also subject to other legal proceedings and claims that arise in the ordinary course of its business. The Company does not believe the outcome of these other matters will have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows.